Health & Medical

Canadian Pharmacies Vs. Big Drug Companies

Look here first for late-breaking news about the David/Goliath battle between Canadian drug stores attempting to help American seniors buy affordable drugs and Big Pharma doing everything it can to prevent it.

Remember: The most effective drug in the world is useless unless affordable.

Canada’s drug distribution and pricing systems are less likely to foster counterfeiting.


Even though the practice is illegal, Americans in droves have been importing prescription drugs from Canada. Last year, an estimated 2 million U.S. citizens spent $800 million on medicines purchased from Canadian pharmacies by fax, phone, or Web site. That’s 33 percent more than in 2003. A long list of states and cities, including Kansas, Illinois, Minnesota, Missouri, New Hampshire, Wisconsin, Boston, and Portland, Maine, has set up programs to help residents and employees import Canadian drugs priced on average 25 to 50 percent below those on the U.S. market.

What’s happening is controversial. The U.S. Food and Drug Administration stands foursquare against imports, arguing that it cannot ensure they are safe. Many Americans, however, believe that buying from Canada, a familiar next-door neighbor, is no more dangerous than picking up a prescription at a local drugstore. Almost 70 percent of the 1,400 people surveyed by the Henry J. Kaiser Family Foundation and the Harvard School of Public Health in November 2004 said that allowing citizens to order drugs from Canada would make medicines more affordable without sacrificing safety or quality.

Here’s the reality of the government’s arguments against buying from Canada:

Canadian drugs are not as safe as U.S. drugs.

False. The FDA maintains that “many drugs obtained from foreign sources that purport and appear to be the same as U.S.-approved prescription drugs, are, in fact, of unknown quality.” Furthermore, FDA officials have expressed the concern that news of product recalls issued in Canada may not reach U.S. consumers.

But Canada’s manufacturing and regulatory system are comparable to that of the U.S., according to an October 2003 study by the state of Illinois’ Office of Special Advocate for Prescription Drugs. FDA critics counter, moreover, that the agency cannot entirely ensure the safety of drugs manufactured in the U.S.

The Illinois study also concluded that Canada’s pricing and distribution system is less likely to foster the drug counterfeiting that concerns the FDA. Drugs in the U.S. typically move through multiple vendors (manufacturers, wholesalers, repackagers, retailers, second repackagers, etc.) before reaching the patient.

In Canada, medications are dispensed mainly in typical dosages and shipped in sealed packages directly from the manufacturer to pharmacy. In a June 2004 report, the U.S. Government Accountability Office said that all of the prescription drugs it ordered from Canadian Internet pharmacies contained the proper chemical compositions, were shipped in accordance with special handling requirements and arrived undamaged.

In addition, if a recall is issued for a drug sold in Canada, Canadian pharmacies are required to alert all consumers who purchased the affected lot, regardless of where they live. “This is a global recall policy that has been in place in industrialized countries for decades,” says Andy Troszok, president of the Canadian International Pharmacy Association (CIPA), an industry group that certifies Canadian pharmacies.

Canadian drugs are not always cheaper.

True. To see how much consumers can expect to save by buying from Canadian pharmacies, we asked, a group that evaluates online pharmacies, to compare drug prices from its highest-rated Canadian and U.S. Web sites. (See Brand name vs. generic costs.)

When we compared the lowest prices of five well-known brand-name drugs from both Canadian and U.S. sources, the Canadian pharmacies saved consumers between $72 and $226 per prescription (including shipping charges). Such medications are cheaper in Canada in large part because its federal Patented Medicine Prices Review Board has the authority to limit prices that it deems to be excessive.

But in a similar comparison, a U.S. site had the best prices for the five most prescribed generic drugs. Because generic drugs cost less, the savings are less: from $7 to $31 per prescription. “The larger, more competitive generic market in the U.S. helps keep prices down,” says Thomas McGinnis, the FDA’s director of pharmacy affairs. [Frank’s note: Always check generic prices at Costco before buying elsewhere. They’re generally lowest, often lower than Canada.]

You could get arrested.

True but unlikely. Ordering prescriptions from Canadian Web sites violate the Federal Food, Drug, and Cosmetic Act, which generally makes it a crime for anyone other than the original manufacturer to import a drug, even if it was first manufactured in the U.S.

So far, however, the FDA has focused its enforcement efforts only on those who “commercialize” drug importation. One example: RxDepot, an Oklahoma prescription drug service that was forced to shut down in 2003. But there are currently no plans to charge consumers. McGinnis says, “We are allowed to exercise enforcement discretion, and it’s not our policy to go after individuals.”

Many Internet sites are not legitimate pharmacies.

True but avoidable. CIPA warns that many Web sites selling medications have been created to lure U.S. consumers seeking cheaper prices. Patients who order from such sites run the risk of receiving medications that are sub-potent, improperly handled, or counterfeit.

Furthermore, the FDA says some Web sites may not tell you that a drug they sell you is obtained from an overseas supplier. “You may be sent a drug that originated in Australia, Great Britain, or Pakistan,” says McGinnis. “We don’t know anything about the strength, quality, or purity of those medications.”

Patients, however, can avoid such problems by ordering only from pharmacies that have been thoroughly scrutinized by CIPA. To display a CIPA seal on its Web site an online pharmacy must have a valid Canadian license, submit to a quarterly on-site inspection, and keep personal information confidential in compliance with PIPEDA, the Canadian privacy act similar to The Health Insurance Portability and Accountability Act, or HIPAA, in the U.S.

The online pharmacy must also require you to submit a valid prescription and medical history and to check for possible drug interactions. And CIPA members must let you know in advance if they are supplying you with a medication from another country so you have the right to refuse. You can find a list of the 37 Canadian pharmacies with CIPA seals.

Another source of information about online pharmacies is, whose review process is similar to CIPA’s. It also provides prices and customer feedback.


The flow of prescription drugs from Canada may not last forever.

Ujjal Dosanjh, the Canadian Health Minister, proposed on June 29 that a new supply network is established to keep tabs on the nation’s drugs and those bulk shipments to the U.S. be stopped if the system detects a shortage. In addition, he proposed a requirement that “an established patient-practitioner relationship” should exist before a physician may prescribe any medications.

Whether or not this means that U.S. citizens will have to meet face-to-face with a Canadian doctor before they can purchase drugs will not be determined until sometime this fall when the minister plans to introduce legislation.

Medicare Competition CartoonBut whatever happens, you should take the following steps before ordering:

· Check Consumer Reports Best Buy Drugs to learn about drug options, including generics and over-the-counter drugs, that could save you money.

· Ask your doctor to prescribe generic drugs, which cost much less than brand-name drugs. Remember to buy them in the U.S., where they are generally cheaper than in Canada.

· If you need a high-priced, brand-name drug, check with the Partnership for Prescription Assistance (; 888-477-2669), which lets you find out in one step whether you are eligible for any of the 275 programs that offer cost savings to consumers.

· If ordering from Canada is the only way you can afford the medication you need, go to for recommendations of approved outlets, and look for the CIPA seal to protect yourself.

SEPTEMBER 21, 2005…



By Amanda Gardner
HealthDay Reporter


Prescription drugs are about 24 percent cheaper when bought on Canadian Internet sites than when purchased from the online sites of major U.S. pharmacy chains, new research finds.

The price difference would be even higher if prices at Canadian internet sites were compared to walk-in U.S. pharmacies, said Dr. Mark Eisenberg, senior author of the study, appearing in the Sept. 20 issue of the Annals of Internal Medicine.

“There’s a huge, huge outlay for pharmaceuticals in the U.S, and prices are artificially high,” said Eisenberg, an associate professor of medicine at McGill University in Montreal. “The same exact drug manufactured by the same exact company costs much less in Canada, so people in the U.S. are paying higher prices than they have to.”

The findings were hailed by some activists in the field.

“On a drug-by-drug basis, someone could save well over $1,000 a year. For someone who is not covered by the soon-to-be-rolled out Medicare program and isn’t elderly and doesn’t have any coverage, $1,000 is huge,” said Sharon Treat, executive director of the National Legislative Association on Prescription Drug Prices in Hallowell, Maine. “It explains why some people are doing this. It explains why at least 22 states this year looked at legislation addressing importation.” The association acts as a clearinghouse for information for legislators interested in this issue.

“While there is a widespread perception that prescription drugs are less expensive in Canada, there has not been much research to back this up. Everybody says it’s cheaper in Canada and no one knows if it is and, if so, by how much,” Eisenberg said.

In the United States, soaring prescription drug costs and the growth of the Internet have fueled cross-border drug sales in recent years, with one U.S. Department of Health and Human Services study estimating that more than 12 million prescriptions destined for American patients were filled by Canadian pharmacies in 2003 alone, for a total $700 million in sales.

The U.S. Government Accountability Office recently reported a 25 percent overall increase in U.S. retail drug prices from 2000 to 2004. Price hikes for two brand-name drugs from Pfizer Inc., Lipitor, and Celebrex had the most impact on that increase.

While the Bush administration has firmly opposed legalizing drug imports, government leaders in various U.S. states and cities have set up programs to help cash-strapped residents buy their pharmaceuticals from Canada.

The U.S. Congress is expected to pass legislation to ease Internet drug sales. But in a new twist, the Ottawa government, concerned that pharmacy sales to the U.S. may cause domestic shortages in Canada, is drafting legislation to restrict bulk exports of Canadian drugs, although the legislation is not likely to be as severe as once feared. Any changes would probably not happen until later this year.

The authors of this study compared prices on 44 common brand-name medications at 12 highly ranked Canadian internet pharmacies and three major online U.S. chain pharmacies: CVS, Rite Aid and Walgreen’s.

The survey, conducted at the end of 2004, found that 41 of 44 medications were less expensive on Internet sites north of the border.

The medications with the largest mean yearly savings were Zyprexa (for schizophrenia and bipolar disorder) with annual savings of $1,159, Actos (for control of diabetes), with savings of $852, and Nexium (for heartburn), with savings of $772.

Only three medications, all of them for erectile dysfunction, were more expensive in Canada. This is because so-called lifestyle drugs do not have the same price controls as drugs that are considered “vital,” Eisenberg explained.

The mean savings at Canadian internet pharmacies was 24 percent per dose.

Canadian price savings apparently extend beyond medications, Eisenberg added.

“The same stent here costs much less than it does 30 or 40 miles away in northern New York State,” Eisenberg said. “I published a paper a few months ago comparing the cost of bypass in Canada and the U.S., and it was half as much here with the same outcomes.”

Why the difference?

“Companies will charge as much as the traffic will bear, and the traffic will bear much more cost in the U.S. than in Canada, and that keeps driving up costs,” Eisenberg stated. In addition, Canada has placed price-control measures on brand-name prescription drugs.
Some thought the findings might spur the U.S. government to modify its stance on imported drugs.

“Maybe this is one way to move the federal government,” Treat said. “It’s a ridiculous way to be addressing the problem to go state by state, receiving threats from the government saying it’s illegal, and yet states are doing it anyway. It just shows how desperate they are to come up with anything to reduce drug prices for their citizens.”

JUNE 30, 2005…


By Julie Appleby
June 30, 2005

Saying Canada can’t be America’s drugstore, the Canadian health minister proposed changes Wednesday that could make it harder for Americans to get lower-priced prescription drugs from north of the border. The proposals by Health Minister Ujjal Dosanjh will include a requirement that an “established” doctor-patient relationship exists with a Canadian doctor before prescriptions can be filled.

Dosanjh said the definition of “established” will be worked out in consultation with professional associations that oversee doctors and pharmacists, most of which oppose the practice of co-signing prescriptions by Canadian doctors who don’t actually see the patients.

He stopped short of saying the new rules would require face-to-face consultations between Canadian doctors and U.S. patients. Such a rule, which would not require legislative approval, would severely hamper cross-border sales, which Dosanjh estimated at least about $1.2 billion (U.S.).

Dosanjh also will ask Canada’s legislature to bar bulk shipments of drugs to the USA if shortages occur in Canada. The ban on bulk shipments is aimed at “potential American legislation legalizing the bulk import of Canadian medications,” said Dosanjh, who will introduce legislation on the bulk buying ban this fall.

Congress is considering several bills that would broaden U.S. patients’ ability to buy drugs from Canada. Canadian pharmacists had mixed reactions to Dosanjh’s proposals.

“The message I heard was the medicine cabinet is closed – and we’re happy about it,” says Lothar Dueck of the Coalition for Manitoba Pharmacy, an opponent of drug sales to the USA.

“It’s a poison pill for us,” says Paul Clark, CEO of Hometown Meds, an online pharmacy based in Carman, Manitoba. “While there are a few people right on the border who can travel to Canada, realistically, 99% of the business is done through mail order.”

Andy Troszokys, president of the Canadian International Pharmacy Association, says a doctor-patient relationship already exists between U.S. doctors and their patients, so the Canadian co-sign rule should be dropped altogether, a move Dosanjh’s spokesman says the minister rejected in February.

He says his group supports the bulk ban and hopes to assist the minister in working out details on the doctor-patient rules. Requiring physical exams would damage the industry, he says.

Dosanjh says the pharmacy industry will have to adapt. “There will be an impact,” he says. “But our intention is not to kill the industry.”

For Kaiser’s view on this, go to “Bush Presses Canada to Stop Rx to the U.S.”

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